Domini has a long-standing policy to vote against boards of directors if they do not include at least one woman or minority director. Outside of the United States, this policy is focused on gender diversity.
In Japan, very few women rise to the level of director. According to GMI Ratings, Japan ranks lowest in the world on board diversity, where only 1.1% of corporate directors are female. Women are also rare among top management of publicly traded Japanese firms. In response, Japanese prime minister Shinzo Abe has recently announced aggressive goals to advance women in business.
A survey of more than 10,000 working men and women in Japan found that 44% of respondents believed that diversity leads to increased business performance.
In recognition of this serious problem, each year for the past several years, the Domini Impact International Equity Fund has voted against virtually every Japanese board in its portfolio. We have also taken the additional step of writing to these companies to explain the reason for our vote, and the importance of the issue. In our letters, we cite the UN Guiding Principles on Business and Human Rights as support for our commitment to gender diversity.